Insider NJ

New Jersey Citizen Action Files Protest Against Proposed Bank Merger

Insider NJ — August 2, 2019

Newark — New Jersey Citizen Action filed a formal protest on July 31st with the federal Office of the Comptroller of the Currency challenging the proposed merger of Columbia Bank and Atlantic Stewardship Bank. The letter of protest notes that neither bank has met its obligations in New Jersey under the Community Reinvestment Act, a federal law enacted in 1977 with the intent of ensuring that banks meet the credit needs of low and moderate-income neighborhoods.

"We believe that when banks get bigger they must get better," said Phyllis Salowe-Kaye, Executive Director of New Jersey Citizen Action. "Based on the lending history of both banks this seems highly unlikely to happen."

Public data shows that despite the fact that Columbia Bank and Atlantic Stewardship Bank serve parts of New Jersey that include significant minority populations, both have a deeply troubling history of not lending to African-Americans and Latinos. It also appears both banks failed to prioritize lending to low and moderate-income communities.

"Publicly available data for both banks strongly suggests that neither bank has met their CRA obligations in New Jersey," said Beverly Brown Ruggia, NJCA Financial Justice Organizer. "According to their merger application, no plan exists for the newly created bank to correct their poor lending practices to minority and low and moderate-income communities in order to meet those obligations.

Data from the Home Mortgage Disclosure Act (HMDA) and others sources on Colombia Bank and Atlantic Stewardship Bank reveals that:

The NJCA protest letter urges the OCC to deny the merger application and to require a comprehensive and concrete CRA plan for the banks that will end unfair lending and retail service practices.

"All bank mergers must provide demonstrable benefit to a community," said Chris Estevez of Latino Action Network. "Given the history of these two banks we need to hold them accountable to a reasonable community standard. We should not sanction a profitable merger for banks with a this poor history of lending to the Latino community and other communities of color."

"NJ banks have a history of discrimination against communities of color not only in their lending practices but also by not opening branches in our communities, creating banking deserts," said Bruce Davis, Economic Chair of the New Jersey NAACP. "My organization is strongly opposed to the merger of Columbia Bank and Atlantic Stewardship Bank as not being in the interests of the communities we represent."

"Given the history of these banks, this merger requires an appropriate level of scrutiny by the OCC to ensure the needs of all low and moderate-income communities are met," said Salowe-Kaye.

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